Copper Explorer Sees Cleaner, Greener Opportunities

Source: Streetwise Reports   05/12/2022

Partnership on a water pipeline will serve World Copper’s project, investors, and local communities making it an interesting investment to review. Streetwise Reports is here with the updates.

In April 2022, World Copper Ltd. (WCU:TSX; WCUFF:OTCQB)Chilean subsidiary signed a nonbinding letter of intent with Desaladora Rosario SpA (Desala) for the construction of a pipeline that will provide a desalinated seawater supply alternative for the company’s flagship Escalones project in central Chile.

The pipeline is expected to run from a desalination plant on the coast in the Cardenal Caro province to Escalones in the Chilean Andes, 35 kilometers east of El Teniente, one of the world’s largest underground copper mines. Desala develops water desalination projects using reverse osmosis technologies that allow for the production of high-quality freshwater, free of boron and other chemicals, and suitable for human consumption, irrigation, and mining operations.

According to Peterson, the “exceptional” results of the Escalones preliminary economic assessment (PEA), issued Feb. 15, “confirm that Escalones has the potential to be one of the most impressive copper properties in South America.”

Growing up in the Canadian High Arctic hamlet of Cambridge Bay, World Copper’s CEO and president, Nolan Peterson, saw the benefits of engaging with local communities to build trust at every stage of a mining project’s development. He expects the desalination pipeline partnership to “lead to a strong partnership that will address water scarcity head-on, one of the key impacts of climate change that affects central Chile, and will ultimately secure a sustainable and reliable water supply for our future operations at Escalones, as well provide water for nearby communities, many of which now depend on water supplied by trucks drawing water from continental sources, like rivers, and lakes.”

What’s more, Peterson told Streetwise Reports, “Being involved from the start in the pipeline has a lot of advantages. First, it gives Desala confidence that there will be a buyer for the water. Second, we can work closely with Desala on specifications and design decisions. Third, we can align our messages during the permitting process, and finally, we have the option of investing in the pipeline in the future. All of these advantages—plus the community benefit—make engaging on the pipeline a good long-term investment.”

Escalones Well Suited to Minimize Environmental Impact

Geography and geology support World Copper’s determination to develop a “cleaner and greener mining operation.” Chile is a leader in renewable energy, Peterson noted, “and because Escalones is located on a ridge top, we have gravity on our side. We’re going to look at technological options, like regenerative braking conveyors, that will actually generate electricity from the potential energy of the mining process.”

The Escalones porphyry-skarn copper-gold project has estimated inferred resources of 426 million tons of 0.367% total copper within the oxidized zone, based on nearly 25,000 meters of drill core from 53 holes. The 3.45 billion pounds of copper should be amenable to heap leaching, with an average recovery of 71%.

Given the project’s “very large and thick oxide layer—the largest now in development in Chile—we will be able to mine using an SX-EW (solvent extraction and electrowinning) process,” Peterson said. “Compared to the more common sulfide flotation, SW-EX emits 40% less greenhouse gas per pound of copper produced and uses four times less water. Plus, we do not have to build a tailing storage facility. All of these are important environmental and community benefits.”

World Copper is also exploring the Mancha Amarilla target immediately to the south of the existing resource. Three hydrothermal alteration zones, each measuring between 2,000 and 3,000 meters in diameter, lie eight to 10 kilometers to the north of the main discovery. To date, World Copper has completed four of 11 planned diamond drill holes.

According to Peterson, the “exceptional” results of the Escalones preliminary economic assessment (PEA), issued Feb. 15, “confirm that Escalones has the potential to be one of the most impressive copper properties in South America.” PEA highlights include

• $1,499.6 million post-tax net present value using a discount rate of 8% (NPV₈) at $3.60/pound life of mine (LOM) (20 years) copper price
• $1,822.4 million post-tax NPV₈ at $4.00/pound LOM copper price
• First five years average annual copper production of 124.7 million pounds (Mlbs) or 56,520 tons; LOM average 114.9 Mlbs (52,131 tons)
• First five years, average cash operating (C1) costs of $1.13 /lb copper; LOM average C1 costs $1.19 /lb copper

Zonia Project Adds Depth to Portfolio

Doubling down on projects with SX-EW prospects, early in 2022, World Copper acquired the Zonia copper oxide project through a merger with Cardero Resource. It is in Arizona, another friendly mining jurisdiction. “Given the need for domestic production of critical resources like copper, and the demand for more environmentally aware mining, Zonia has a lot of momentum in its favor,” Peterson said.

Most of Zonia’s mineralized area was pre-stripped during previous open-pit mining operations in the 1960s, when 17 million tons were mined, with 7 million tons stacked on heap leach pads, producing cement copper up until 1975. The property has been drill-tested with almost 700 drill holes (60,000 meters). This high-density drilling covers 30% of the property and defines the current resource estimate, reducing technical risk on the deposit.

World Copper is refreshing the engineering done by previous owners and updating the economics given current market prices and technology and expects a flow of news from the project in 2022.

With a year of public trading under its belt, World Copper has a CA$37.69 million market cap, with just over 94 million shares outstanding. Shares have been trading in the CA$0.45 range.

Disclosures

1) Diane Fraser compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. They or members of their household own securities of the following companies mentioned in the article: None. They or members of their household are paid by the following companies mentioned in this article: None. Their company has a financial relationship with the following companies referred to in this article: None.

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